Creating an effective customer targeting strategy is a challenge that marketers have consistently faced over the years. A dynamically changing market, evolving consumer behavior and preferences, and the rapid development of new technologies are factors that constantly create challenges. On the one hand, they require a continuous modification of the assumptions and developed strategies, and on the other hand, they open up completely new possibilities – i.e. allow for a better and more effective reach of the target group with the message. Why is it worth diversifying strategies and reaching for both contextual and behavioral targeting? What will the cookieless future bring?
In this article you will learn:
- How contextual and behavioral targeting strategies work
- What challenges marketers face when selecting each of these strategies
- How the cookieless future will affect targeting strategies
Table of Contents:
- How to understand contextual and behavioral targeting
- Behavioral and contextual targeting – Similarities
- Behavioral vs. contextual targeting – where is the difference?
- The targeting method and tools we use at RTB House
How to understand contextual and behavioral targeting
The idea of behavioral targeting is to segment your customers based on their past behavior – sites visited, links clicked or purchases made. On this basis, users are classified into specific segments, which are then targeted with personalized advertising. As a result, marketers can more effectively reach their target group with their advertising messages – moving away from ads addressed to the masses and directing them to a narrow group that has expressed interest in a brand, specific product, or topic in the past.
Another method of effectively reaching a specific group of recipients is contextual targeting. The principle of operation is very similar, but the point of focus is completely different. In contextual targeting the key issue is not the user’s past activities, but what they are doing here and now – what content they are currently viewing. If the user visits a website dedicated to renovation and construction, the marketing messages addressed to them will be related to the services and products of renovation and construction. It can be concluded that contextual targeting is an effective method of reaching the user with a potentially interesting message at the best possible moment.
Behavioral and contextual targeting – Similarities
To create a winning marketing mix and properly select methods of targeting potential customers, you need to have a good understanding of the similarities, differences, and current challenges of each method. Let’s start with the elements that we can consider to be the common denominator of behavioral and contextual targeting.
Both behavioral and contextual targeting assume the use of some kind of intelligence, which makes them dynamic and extremely powerful tools in the hands of experienced marketers. The best solutions on the market use Deep Learning to enhance the accuracy of targeting, choose the most effective creations and even predict the propensity of a conversion – consider this while working on your marketing mix. Both methods – behavioral and contextual targeting – allow you to reach your target group more effectively than mass marketing or demographic targeting. A well-thought-out targeting strategy leads to more effective use of the marketing budget and the achievement of various goals.
What behavioral targeting and contextual targeting have in common is the fact that both strategies are not perfect. They don’t work in every situation, they have certain drawbacks, and they carry certain limitations and challenges that you need to be aware of when defining the optimal strategy for your business.
Good To Know: What is Contextual Targeting in Programmatic?
Behavioral vs. contextual targeting – where is the difference?
The main difference between contextual and behavioral targeting is the point of focus – in behavioral targeting you monitor the user’s online behavior, while in contextual targeting you monitor the content of the page they’re viewing.
Let’s start with behavioral targeting. Monitoring users’ online activities allows you to draw many accurate conclusions about their interests, desires or plans, but it also carries a high risk of error. To accurately assign a user to a particular segment, it is necessary to take information about their activity on many different devices they may use into account. The omission of any of them may strongly distort the proper characteristics of the customer and result in directing ads to them, which are not necessarily of interest to them.
Ad mismatches can also result from a particular user sharing a device with others. It is not uncommon for a laptop to be used by several household members. Is this a big problem in terms of targeting? It turns out that not necessarily, or at least it’s getting smaller with each passing year due to the growing importance of mobile. A study conducted by Statista in February 2022 shows that mobile devices are used by 90% of the global internet population. What is more, mobile internet traffic accounts for around 55% of total web traffic.
Focusing on historical data also carries the risk that the ad will reach the user too late. The fact that the user has browsed travel agencies’ offers and visited airlines’ websites does not mean they are still planning their vacations. The user may have already returned from their vacation, so targeting them with ads for suitcases or travel insurance will not bring the intended effect. When designing a targeting strategy, you should take this into account and think carefully about the look-back period and segmentation criteria. This is also one of the situations when it is also reasonable to use the opportunities offered by contextual targeting – knowing the segment to which the customer is assigned and knowing the context of the visited website, you can address a specific ad to them even more precisely. If a user has shown interest in vacation trips in the past and is currently visiting a travel advice site, they are probably still planning their trip, so the chances for conversion are still there. It’s up to you if you want to use behavioral targeting, contextual targeting or both at the same time – everything is doable so think about your goal, take the requirements into account and then choose the method that best suits your needs.
Contextual targeting seems to effectively address the shortcomings of behavioral targeting – it avoids the risk of ad mismatch, does not rely on cookies, and does not entail concerns about privacy or ad fatigue – the ad does not follow the user. Of course, this method is also far from perfect. Not everyone who visits an automotive blog has the intention of buying a car. Bearing the above in mind, you shouldn’t focus only on one targeting method and cross out other methods of reaching potential customers. The choice can’t be made in isolation from the goal of the campaign, its assumptions or the specificity of the business.
The targeting method and tools we use at RTB House
You already know how both targeting methods work in practice, so now it’s time for you to find out how RTB House can help you reach your marketing goals. If you plan to use contextual targeting, you need to know that:
- to reach the right audience for your business we use AudienceAI – it assumes the departure from the traditional targeting methods based on third-party cookies to real-time audience with maximum impact, based on zero- or first-party data. The advantage of this method is also the elimination of biases regarding the best audience to target – the results are analyzed, optimized and adjusted 24/7 by Deep Learning algorithms that predict user behaviors precisely and in real time,
- for the web environment we use our internal tool ContextAI which is in fact part of AudienceAI and helps to better understand the context the user is browsing in real-time and, as a result, allows us to reach the right audience in the right environment to maximize ad impact.
We support all targeting methods available on the market, so you don’t have to worry about anything. Tell us what your business goals are, and we will recommend the best method to support your goals and aspirations.
The behavioral campaigns we support are based on site behavior or banner interaction such as impression, click or complete view. It’s an effective advertisement method that can help you fight to get your ex-shoppers or ex-visitors back. How? Your best customers will be targeted with ads that remind them about your brand or show products selected based on their preferences and shopping habits.
Wondering how the cookieless future will affect targeting effectiveness? To what extent will what you have achieved be lost? Contextual targeting is not cookie-based, so think about taking this method into account and including it in your strategy. We talked to Catalina Balan, Data & Technology Director at Publicis Groupe, about how the move away from 3rd Party Cookies will change targeting methods. Also check out insights from an RTB House roundtable regarding the cookieless future.
Do you have any additional questions? Our experts will be happy to answer them and suggest an optimal solution. Contact us.